Alaska governor vetoes bill to tax e-cigs and raise minimum age for tobacco

Dunleavy cites opposition to a tax on electronic smoking products in his veto

By: - September 9, 2022 7:30 pm
Jeremy Wong smokes an e-cigarette in 2018 in California. On Friday, Alaska Gov. Mike Dunleavy vetoed a bill that included a tax on electronic smoking products that contain nicotine. (Photo by Justin Sullivan/Getty Images)

Jeremy Wong smokes an e-cigarette in 2018 in California. On Friday, Alaska Gov. Mike Dunleavy vetoed a bill that included a tax on electronic smoking products that contain nicotine. (Photo by Justin Sullivan/Getty Images)

Alaska Gov. Mike Dunleavy on Friday vetoed a bill that would have raised the minimum age to purchase and legally possess tobacco products from 19 to 21 years old. The bill also included a tax on electronic smoking products that contain nicotine, which is what Dunleavy took issue with.

Currently, Alaska has a cigarette tax of $2 per pack. Other tobacco products, like cigars, are taxed at 75% of the wholesale price. Electronic smoking products like vape pens that contain nicotine, on the other hand, are not subject to tax at the statewide level, though some municipalities have levied their own tax.

The tax portion of the bill was aimed at discouraging people from getting addicted, said bill sponsor Kodiak Republican Sen. Gary Stevens.

“One of the things we’ve seen in tobacco taxation is that every time taxes are increased on tobacco – and they have been increased several times in Alaska – people stop using it. The number of people who use tobacco decreases every time tax goes up,” Stevens said Friday afternoon.

In various versions of Senate Bill 45, the amount of tax on e-cigarettes changed over time. When the Senate passed the bill 15-4, the tax was 45% of the wholesale price. It got changed to 25% in the House committee process and again during amendments on the House floor. The version that passed the house 31-9 had a 35% tax of the wholesale price of electronic smoking products.

In vetoing the bill, the governor wrote, “There were many conversations about what an appropriate level to tax would be, but ultimately a tax increase on the people of Alaska is not something I can support.” 

The bill would have put Alaska in line with the federal minimum age, which is 21, to purchase tobacco products. The bill would have also raised the minimum age of selling tobacco products to 21.

Stevens said if he’s back in the Legislature in January, he will pursue another version of the bill. 

“It just means that we have to be smarter next year and work with the administration to make sure that we come up with a bill that they can support. And I think we will,” he said.

Stevens said it’s an important bill. 

“It’s an issue of great importance. I think it should be with families and parents and children. You don’t want your kids addicted to vaping, particularly at a young age.”

This is the only bill that Gov. Dunleavy’s has vetoed in the past two years, other than vetoing specific line items in budget bills. It’s his second veto in his time as governor. The first bill he vetoed would have restrained a governor’s ability to pay some state employees more than the salary scale and to hire employees for temporary duties not designated by the Legislature.  

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Lisa Phu
Lisa Phu

Lisa Phu covers justice, education, and culture for the Alaska Beacon. Previously, she spent eight years as an award-winning journalist, reporting for the Juneau Empire, KTOO Public Media, KSTK, and Wrangell Sentinel. She's also been Public Information Officer for the City and Borough of Juneau, lead facilitator for StoryCorps Alaska based in Utqiagvik, and a teacher in Tanzania and Bhutan. Originally from New York, Lisa is a first generation Chinese American and a mom of two young daughters. She can be contacted at [email protected]

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